Siemens Ben-Q


Though in the early part of the 2000s it once ranked among the world's top 5 global handset makers, shipping millions of phones per quarter in the United States and elsewhere, German industrial giant Siemens began struggling in the market, facing competition on the high end and the low end from the likes of Samsung, Nokia and Motorola. The company at the corporate level essentially decided it didn't have the chops to compete in a rapidly evolving market increasingly dominated by blockbuster handsets like the Razr, which was introduced in 2003.

Siemens in 2004 finally decided it needed a way out of the business, and began shopping its ailing mobile phone business in an increasingly public manner. Finally, in June 2005, Taiwanese electronics manufacturer BenQ agreed to take over Siemens' handset business. (Interestingly, Siemens didn't exactly sell its business to BenQ. Instead, Siemens agreed to pay BenQ $307 million for "ongoing support" and purchased a 2 percent stake in BenQ for $61 million.)

BenQ, which built everything from digital cameras to LCD screens, agreed to take on Siemens 6,000-employee mobile company in a bid to dramatically expand its own tentative steps in the mobile phone world. BenQ's transaction with Siemens immediately catapulted the relatively obscure manufacturer into the global handset game--a combined Siemens and BenQ commanded a 5.7 percent market share in the first quarter of 2005, according to Strategy Analytics, behind the world's fourth largest handset vendor LG and just ahead of Sony Ericsson.

But the transaction did not result in a successful player. Partially due to labor costs (and an aging product lineup), BenQ foundered through two years of financial ruin until it finally filed for bankruptcy in 2007. That action brought an end to both the Siemens mobile phone brand and BenQ's attempts at growth.